Home Blockchain Crypto lending rates are low and DeFi is not competition says Nexo...

Crypto lending rates are low and DeFi is not competition says Nexo co-founder



Much has been said about attractive interest rates offered by popular crypto lending platforms like BlockFi, Celsius Network and Nexo. However, there are two sides to every coin. Paying out high interest rates requires charging even higher rates to the borrowers. 

Yet, Nexo co-founder Antoni Trenchev disagrees that crypto lending rates are high. In an interview with Cointelegraph, he said that this reflects the “Western” view, where the prevailing interest rates tend to be low. But it is not the case in the developing world, he said:

“But for people in Third World countries or even emerging markets, such as Asia, we get as low as 5.99% APY. So this is still very, very low, no matter how you compare it with the traditional financial sector. And the reason why it is like that is that it again has to do with the risk of the underlying assets and the collateral and the fact that we do not do credit checks on you.”

Everything is relative. Although the rates offered by the lending platforms may look relatively high when compared to bank savings accounts or even money market instruments, they pale in comparison to the yields offered by DeFi projects. When asked if he views DeFi projects as competition, Trenchev said Nexo does not see DeFi as direct competition. He said that though he likes the concept of DeFi, having a traditional finance background, he finds the space too risky for his personal taste. He has not participated in any yield farming either. He added:

“In order for it to be decentralized, it has to be all on blockchain and not fiat related. Right now, Nexo is positioned as a bridge between traditional financial markets and the crypto space. And we just see ourselves doing something slightly different.”

But does this mean most of Nexo’s borrowers come from the developing world?  Trenchev did not have precise numbers at his disposal but noticed that they typically see an influx in demand from countries that have experienced inflationary pressure like Turkey.



Read orginal here

- Advertisement -
Mr Bitcointe
Mr Bitcointehttps://www.bitcointe.com/
“Fact You Need To Know About Cryptocurrency - The first Bitcoin purchase was for pizza.” ― Mohsin Jameel
474FansLike
76FollowersFollow
4,567FollowersFollow
5,261FollowersFollow
1,552FollowersFollow
2,230SubscribersSubscribe
USD - United States Dollar
EUR
1.18
GBP
1.30
CHF
1.10
NOK
0.11
JPY
0.01
CAD
0.76
AUD
0.71

Most Popular

Ontology Takes Centre Stage at Blockchain Expo Tokyo | by The Ontology Team | OntologyNetwork | Oct, 2020

Following the launch of our highly anticipated bespoke automotive solution and our recent partnership with global financial and mobility services provider, Daimler Mobility, Morio...

Bitcoin can’t help bank the unbanked claims Mastercard CEO

Bitcoin cannot function as an inclusive currency for the unbanked due to its volatility, Mastercard CEO Ajay Banga said during Tuesday’s Fortune Global Forum...
bitcoin
Bitcoin (BTC) $ 13,697.09
ethereum
Ethereum (ETH) $ 403.99
ripple
XRP (XRP) $ 0.252049
tether
Tether (USDT) $ 1.00
bitcoin-cash
Bitcoin Cash (BCH) $ 265.35
bitcoin-cash-sv
Bitcoin SV (BSV) $ 174.57
litecoin
Litecoin (LTC) $ 59.21
eos
EOS (EOS) $ 2.65
binancecoin
Binance Coin (BNB) $ 31.63
okb
OKB (OKB) $ 4.62
tezos
Tezos (XTZ) $ 2.07
leo-token
LEO Token (LEO) $ 1.28
cardano
Cardano (ADA) $ 0.100858
monero
Monero (XMR) $ 132.64
stellar
Stellar (XLM) $ 0.081223
chainlink
Chainlink (LINK) $ 11.83
huobi-token
Huobi Token (HT) $ 4.29
tron
TRON (TRX) $ 0.026948
usd-coin
USD Coin (USDC) $ 0.999506
dash
Dash (DASH) $ 70.45
neo
NEO (NEO) $ 16.86
iota
IOTA (MIOTA) $ 0.276664
nem
NEM (XEM) $ 0.096403
zcash
Zcash (ZEC) $ 60.55
maker
Maker (MKR) $ 585.53
paxos-standard
Paxos Standard (PAX) $ 1.00
ethereum-classic
Ethereum Classic (ETC) $ 5.49
vechain
VeChain (VET) $ 0.011283
true-usd
TrueUSD (TUSD) $ 0.999443
ftx-token
FTX Token (FTT) $ 4.00
kucoin-shares
KuCoin Shares (KCS) $ 0.852026
waves
Waves (WAVES) $ 3.14